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#BrewersDownTheDrain: A Covid Reflection

Date 25.03.2021

Will beer gardens ever be the same? University of Northampton Marketing Lecturer, Simon Wragg, who holds a Diploma from the Wine and Spirit Education Trust, shares his thoughts on the impact Covid continues to have on the small brewers of craft beers in the UK, and why he’s worried what pint he’ll be poured on 12 April.

“As the nation reflects and contemplates on a year of life in lockdown and the many losses and sacrifices that have been made in terms of human loss, coupled with the financial, economic, and emotional strain, there remains the question of ‘what next’? What is left of the ‘normal’ we once knew?

The Prime Minister the other day spoke of “the great spirit” shown by the nation over the past 12 months and of the ‘huge toll’ taken on us all. This toll, of course, has been hardest and heaviest in the human losses and emotional cost on people who have lost loved ones, there have also been great burdens on mental health and the economic and financial burden has been high. Many industries have been hit hard by the pandemic, many workers furloughed or made redundant, the hospitality industry particularly hard hit by the impact of Covid-19. However, now the vaccination programme is underway, the jabs are rolling out, and we have a roadmap to slowly release us from our lockdown nightmare, plenty of us are beginning to dare to think of a return to some sort of normal.

Yet as some of us might be contemplating a return to the beer garden outdoors to celebrate when restrictions relax on 12 April, not everyone is contemplating a happy return to normality. I have spoken before about the impact that the pandemic has had on the drinks industry yet as we edge ever closer to the light at the end of the proverbial tunnel, for some breweries and beer-makers the tunnel might be simply too long or too deep to escape from. The Prime Minister might speak of the ‘great spirit of the nation’ but for some, the spirit of innovation, creativity, passion, and love of the artisan, might simply not be enough.  Before we start mixing our metaphors too much let me explain how, in a small way, a return to some sort of normal might not be possible for some of the most creative, innovative businesses, and tradespeople in the UK.

In 2018 the global craft market was valued at $37.5bn and is forecast to reach over $92bn by 2025 (Mintel 2018). In the UK alone, there are 1978 active microbreweries (Statista) and although the term ‘craft’ beer is much discussed and lacks a formal definition in the UK, these microbreweries are often associated with small batch output and independent breweries, certainly in the minds of consumers who feel this needs to be the case.

These small, independent brewers have become a beacon for ingenuity, innovation, and creativity in the types of beers produced (some weird and wacky combinations of ingredients), packaging (again weird and wacky labels and artwork out there!) and marketing tactics. The volume of production has also been impressive with 2.8 million hectolitres of craft beer produced by members of the Society of Independent Brewers (SIBA) before Covid hit. During the first lockdown, small brewers’ sales collapsed by over 80%, and it was estimated that some 70 million pints were thrown away. Just as we think about returning to beer gardens though, the impact on these small brewers has not gone away.

Despite the recent budget and the Chancellor giving the hospitality industry some much needed assistance, many of the most creative and innovative beer-producers will miss out on the assistance which will in return rob the consumer of some of the most interesting (and locally produced) beer that they had consumed in ‘normal’ times, surely not the ‘new normal’ that beer-drinking UK consumers are dreaming of?

The reasons for the precarious position of future craft beer production are various. There were already pre-planned changes to the Small Breweries Relief (SBR) scheme, a scheme set up in 2002 that many believe has been the catalyst for the innovation and successful growth in the UK brewing industry, changes that will see some of the smallest producers’ hit hardest as the Treasury plans to reduce the current tax threshold based on production volumes reduced from 5,000hl to 2, 1000hl. This will impact many small breweries meaning they have to pay more tax. Coupled with debts incurred by the bounceback loan schemes (as opposed to direct grant schemes), the VAT cut extension not applying to alcohol, and that there was no relief granted on business rates for breweries, all this combined leaves small breweries again facing the prospect of destroying good beer and pouring their artisan labours down the drain.

The Society of Independent Brewers (SIBA) are so concerned they even have a campaign #BrewersDownTheDrain to highlight the plight of small brewing concerns.

Yet it is not just the breweries themselves who might suffer or lose out. What about the loss of diversity and choice to UK consumers in our pubs and on our supermarket shelves? As the economy begins to slowly open up, it would be a great shame if the UK consumer was to suffer again from losing this part of our retail lives – the diversity and choice offered by these independent producers, often part of the local community. In a year when the nation lost so much it would be a tragedy if such things as this, representing individual endeavour, artisan ideas, and creative ‘spirit’ was also lost. Surely not a ‘new normal’ anyone would aspire to?

As we reflect on a year since Lockdown 1 commenced, spare a thought for those who might still yet get left behind in the wake of Covid-19. As has been commented by many before, nothing will ever be quite the same again.”

 

 

 

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